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Running Debian GNU/Linux from an encrypted USB drive

Very nice, the problem here is that the PC will then not boot without that drive attached. You have in effect made the USB drive a key to access any other OS on that computer.

So even for geek points you score a zero for this, if only because if doing as you suggest, you have bricked your system. Nor is the drive "portable" to another system without doing a GRUB install on it and turning a second machine into a brick.